Gce Model Questions Vol1 2024 Economics Question 41

Practice objective / multiple choice question 41 from the 2024 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2024 Economics Objective / Multiple Choice Medium Difficulty
Question 41 GCE_MODEL_QUESTIONS_VOL1 • 2024 • ECONOMICS • objective

In a market for a homogeneous good, the inverse demand curve is \(P = 120 - 2Q\) and the total cost function is \(TC = 20Q + 0.5Q^{2}\).\n(a) Determine the monopoly equilibrium output, price and profit.\n(b) Assuming the market were perfectly competitive, find the competitive equilibrium price and output.\n(c) Calculate the percentage increase in consumer surplus when the market changes from monopoly to perfect competition. Give your answer to one decimal place.

Answer Options

Correct Answer A. Consumer surplus increases by approximately 177.8%
B. Consumer surplus increases by approximately 165.4%
C. Consumer surplus increases by approximately 120.7%
D. Consumer surplus increases by approximately 190.1%
Correct Answer
A
Correct Option:
Consumer surplus increases by approximately 177.8%

About This Question

This is Gce Model Questions Vol1 2024 Economics Question 41. It is one of the objective questions from the 2024 Gce Model Questions Vol1 Economics examination.

Difficulty level: Medium .

View More Gce Model Questions Vol1 2024 Economics Questions More Gce Model Questions Vol1 Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support